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If I had 3 wishes…

Well it appears I’ve gone from the sublime to the ridiculous. A few months without much to speak of and now a glut of posts in a matter of weeks. I guess it’s down to a number of things that have prompted me to think about a raft of business and personal issues and apologetically wallow in a little self-reflection. Pondering the past, evaluating the present and imagining the future.

I’ll warn you now…this is a biggie.
You may need to refresh your coffee cup before getting stuck in!

The main thrust of this post is growth. But have no fear, this will not contain any form of shrewd business logic or financial acumen. As you have probably come to expect from these posts, I tend to shoot from the hip and wear my heart on my sleeve (and other such figures of speech you may wish to include – which basically mean I ramble on with little or no research). It will primarily be based on anecdotal evidence and first hand experience.

Over the past months (as I have eluded to in previous posts), I have been keen to discuss the future of ‘Square Banana’ and ‘Russell Beard’ (very odd to be talking about myself in the third person) with a business coach and how these two elements might differ, integrate, deviate and prosper. I’ve taken steps to try and implement some of the shorter term strategies that seem to make sense, but it is the mid to long term aspiration of growth that has been monkeying around in my brain and it simply refuses to settle or focus on a specific goal. So I decided to investigate…

The traditional model of design consultancy growth doesn’t necessarily sit well with me. The idea that more work = work people = more work = more people etc. feels a little too organically open-ended. Not that it hasn’t worked for a huge number of consultancies. It has, and many of the biggest and best are still here because of it. It’s not that I think it doesn’t work, but funding channels and growth models have changed a great deal in the last 5 years alone. We now live in a vastly different world with a plethora of these different models abundantly evident in the techno-biz pages of many blogs, rags, journals and periodicals around us. In fact, it’s often tricky to keep up with them as they change and adapt to the force of consumer opinion.

I’ve been privileged to have experienced a number of design consultancies that have experienced ‘fairly’ rapid growth, but they have – to my mind – paid the price in doing so. A small-ish studio or tight-knit design team has a palpable soul. A unified heartbeat if you will. A feeling that whilst everyone may well be from different backgrounds, of differing experience levels and working on different projects, they all seem to be marching to the same drum. It’s a fabulous feeling but something that tends to be noticed in retrospect…once it has been lost. Growth past a certain point tends to erase this soul. The larger consultancies that manage to preserve this ‘essence’ should not be underestimated as it is a bloody tricky thing to maintain and nurture as the ship gets bigger. I always remember attending a Design Council training course (Professional practice level 2 – with Shan Preddy – if I recall correctly) where a director of a branding consultancy based in the South West said that they planned to only grow to 12 people. This included admin staff. In other words, no more than 12 people could occupy the building. I liked that sentiment and as the years have progressed I tend to agree more and more. Not necessarily with the 12 value, but with the idea that a design business has an ’employee cap’ which shalt not be breached. That number and how you calculate it is ultimately up to you and how you feel your business best needs to operate. (BTW – I have no idea whether that particular director stuck to his guns and has made a success of that plan).

With these experiences swimming around my brain, I decided that the best thing to do was to seek tales of historical growth and growing pains from those who have been through it successfully and with a track record to prove it. Design business owners who have (or had) successful studios with substantial numbers of people delivering award winning work. I won’t divulge the various people I managed to ear-bend but needless to say I was fairly surprised by what they had to say. The most interesting and revealing statement I heard was that, despite now having a large, blisteringly successful design business, if the person in question had their time over again (and in the modern era) they would seek to establish a very small, ideas driven, design service agency that would never get particularly big at all. In fact, they admitted to never really ever having aspired to growth at the level they have attained, and in some way lamented the beast they were since responsible for creating. I find this fascinating. In fact, the latter part of this statement rings true with quite a few mid-to-large design business owners that I have had the pleasure of speaking with over the years – the sense that they now find themselves spending the majority of their time worrying how they are going to feed the salary monster, rather than actually doing the one thing they set out to do when they registered at Companies House in the first place….design. I guess – deep down – that is why I have remained ‘on the tools’, a practitioner rather than a manager…a ‘player manager’ if I’m to use a footballing analogy. Without consciously deciding to do so, I guess I’ve probably resisted natural growth due to my inherent desire to DO the designing. I understand that this is an unsustainable business model, but I guess I’m trying to unpick the reasoning.

So, the idea of capped growth and a more honed, S.W.A.T. team ethic tends to sit better with me than the more open ended model mentioned earlier. To my mind, it seems to fit with the types of work we typically get involved with and can certainly – if positioned correctly – appeal to both SME’s and global businesses alike. Switching from football to rugby analogies for a second (Union code for the rugby pedants out there), I would liken it to a Barbarians Sevens team (if such a thing existed). A mixture of different skills, personalities and levels of experience but whom all play together well, are at the top of their game and can switch skills if necessary. Everyone mucking in. I’m not saying that it’s necessarily a perfect model for ‘business’ i.e. a distilled profit making machine. A relatively flat hierarchy will always have its problems, but it feels like it would allow the two differing personas of ‘design’ and ‘ business’ to co-exist relatively easily for the greater good of the bottom line and for the integrity of the creative output. My gut tells me that I would be as satisfied as a designer as I would be as a businessman. The tricky thing will be to find like minded creative and business minded people who can fill the other 6 positions (figuratively speaking)!

So we’ve established my ideal design business framework. But how the bejesus do we get there. To that I have no answers. From my personal perspective, I seem to be stuck in a timeloop where I seem to be eternally shackled to either a) sales b) designing/delivering or c) business ownership issues (those indefinable tasks that seem to eat away hours of your day). These things tend not to be mutually inclusive and it’s a constant struggle to balance them effectively without falling off the eternal precipice of joblessness that ever-lingers about 3 to 4 weeks in front of me as I stumble (in as graceful as way as I can muster) through the year. I can very easily see how with 5 people in a studio, these issues can be carefully delegated and managed to maximum effect, but I often struggle to see how I get from here to there without keeling over with overwork or running out of that most precious of resources…cash!

So how do I get Square Banana to that point where we have a studio filled with 5+ capable others who all fulfill the necessary roles required for maximum efficiency and creativity, and yet we are incredibly relevant as a business unit? The modern press is awash with funding success stories. Dragon’s Den, Kickstarter, Crowdcube, The Thiel Fellowship…the list goes on. Lots and lots of ‘buck the trend’ tales of maverick designer-makers taking the unorthodox approach and securing hundreds of thousands (if not millions) in deals to help them grow their businesses – some of which, despite my best efforts, I simply cannot begin to comprehend. We tend not to hear about them as they grow, but only at the point of ‘springboard growth’ when they become catapulted from zero to hero…and become the new poster-boys/girls for the ‘do it yourself’ generation. In truth, they tend to be businesses that are either selling a ‘thing’ that appeals to the masses or a technology/app that capitalises on a market trend or societal shift. The funding channels also seem to be polarised – the investor is either a gazillionaire with money to throw at a risky venture (and some healthy PR to boot), or you are attempting to appeal to a huge number of armchair investors with anything from £5 to £5000 to ‘spare’. The idea that you are recruiting a hoard of supporters, advance customers and marketing advocates. It’s powerful stuff if done correctly, but tends to be relatively short term, focussed on a singularity and riddled with a potential groundswell of dissatisfaction from people/investors unaware of the time and complexity inherent in bringing something to market (if you are to believe the forums and comments sections of many of these).

So where does ‘design consultancy’ fit into this? It is neither selling anything tangible, nor spearheading a new, groovy tech. It is selling brain equity. Thinking. Problem solving. Ethereal magic…albeit process driven magic! I’ve often wondered whether a design business like ours could effectively appeal on crowdfunding platforms like Kickstarter or Crowdcube, but I’m not sure it’s tangible enough for people to comprehend. It’s hard enough explaining to someone what product design is, when given a fully engaged audience, let alone attempting to sell mini-packets of equity or ‘product promise’ as internet soundbites through a computer screen. Someone may well prove me wrong, and I’m curiously intrigued to try it myself, but ‘hunch’ tells me it can only end in disappointment or utter complication and confusion. In another guise and a number of years ago, I actually used a crowdfunding site to seek funding for a product, and have been somewhat soured by the experience, but that story may well be for another day.

What about a loan from the bank? You’re kidding right? Admittedly I haven’t broached it fully with my bank manager, but let’s just say that given my recent, brain boiling, anger inducing experiences of attempting to secure a mildly conservative business overdraft facility recently (from a bank I have been with for nearly 20 years I hasten to add) I don’t hold out much hope. Unless they take children as part payment (they have all their own teeth)!

There has been much talk of recent successes with South West initiatives like the Bristol Growth Fund. Trunki (under the wise leadership of Rob Law) has been rightfully successful in securing an impressive amount of funding to help grow their product range and help get into more international markets, but I’m still dubious about how well a fund like this would judge the worthiness of an intangible service offer such as ‘design consultancy’ when so many other businesses selling ‘things’ are much easier to quantify and ‘grow’ in the most tangible sense. Maybe every design consultancy should have a product of their own to enable their tangible business potential to be measured more easily? Strangely enough, given the sheer number of product design agencies in the UK, there are only very few that have ‘side’ projects of commercially valid product launches. Therefore (with TomTom) and Yves Béhar/Fuseproject (with various high profile products – Jawbone being one) are the obvious exceptions to this, but it does seem odd that with the talent resource available to each design business and the offer they provide to clients, that it isn’t the norm rather than the exception. For my sins, I have actually tried doing it (albeit as a separate business venture) and it didn’t work. I plan to bore you all with this in a few months…

Much has been made in recent times of means by which ‘small businesses’ can access vouchers, start-up or growth loans from the Government. There are more ‘incubator units’ than I can thrown a stick at, and there is talk of getting students to by-pass university (as many employers are complaining of the lack of real world skills these graduates are coming out with) and head straight into the big wide world with a helping hand and some pocket money to support them. This is great if you are an individual or – literally – a very small business, where ‘up to’ £25K can seriously give you that leg up to where you may need to be (note the prevalence of the term ‘up to’ in most of these schemes). What happens if you are a small business where £25K would get lost in a matter of weeks? Not wishing to look a gift horse in the mouth, but it’s peanuts.

Then there is the tried and tested channels for ‘proper’ funding. The ‘acquisitions and mergers’ boys. The ‘business angels‘ with various recent tax incentives to ‘nudge’ them towards making investments (SEIS is one such example). I was made aware of a recent report by Lord Young (click here to download) where he sets out all of the options. It reads well and as a SME, it ‘feels’ like there is support out there and a genuine desire to help Britain’s small businesses to grow. As the stats indicate, if they are supported and helped to grow, the country will recover. I can’t work out if it’s all lip service and the examples they use are simply those people that would succeed despite everything listed in the report. There’s also a nice case study about Crux in there – run by 4 guys I have had the pleasure of working with in times past. Very different to Square Banana, but nevertheless flying the flag for well intentioned product design thinking in the South West.

Right! Enough of that. I’m getting far too sterile and dry in my writing. I need to inject a bit more whimsy and emotion before I run the risk of producing a well-balanced piece (whatever that may be)!

So what’s the answer. In short, I’ve no real idea. I’ve got a few hunches and a gut feel for an ‘ideal’ design team that could deliver brilliance. All I actually know is that I currently run a business that has an amazing client list, works in pretty much the widest cross section of projects you could venture to name and that could become something very impressive indeed. I firmly believe it, but as it stands, I can’t see the benefits of the slow organic growth mentioned at the start of this post. I only really see benefit in turbocharging this business and giving it the opportunity to accelerate up to that Barbarians Sevens team. That size of team brings with it a co-operative chutzpah, a team vision and a powerhouse of thinking that isn’t diluted by size or crippled by being seen as ‘too small’. I reckon I can build that team.

So, in true Aladdin style, I figured I’m due 3 ‘virtual’ wishes. So in relation to what I think might work as a growth framework (in specific relation to product design consultancy and – very specifically – Square Banana), here they are:

Cash. Design businesses are beholden to cash-flow (not that others are not) and this is the key factor in limiting realistic ambition. Even being prudent, to attempt to squirrel away enough cash to enable the kind of growth that would deliver the powerful design offer I know is possible from the business, would take an inordinate amount of time. I’m not talking about an ‘open wallet’…simply access to cash that could facilitate growth, give the business a bit of a security blanket whilst we build the machine and be repayed or re-invested once the machine is pumping! And pump it will.

A credible big brother. This is a careful one. Whilst I don’t really know how this would manifest, I like the idea of having a partner/investor who is a credible entity in their own right. By ‘credible’ I mean that they are a brand that understands consumers, understands design and has an infrastructure to benefit having access to a business like Square Banana. A partner that would not restrict our abilities to work in any market sector we choose to. Designers don’t really make great ‘businessmen’ per se, and I’ll be the first to admit that whilst I know the design industry back to front, I’m not sure I’d be reliable enough to make the kinds of sterile, unemotional business decisions that so often signal a successful turning point in a company’s history. I could lie and say that I could, but I’d be kidding myself and blowing smoke up my own arse. Design is an emotional game…at least in the territories in which we operate. We are brilliant at designing for people. Consumers. But it takes an altogether different person to make shrewd business decisions that are devoid of such emotion.

A ‘belief’ punt. Whomsoever decides that they might want to help this brilliant little business needs to do so with a healthy dose of ‘close your eyes and jump’. To use a carefully spelled word – a PUNT. No ‘interference’ to try and turn it into a ‘model’ business or attempt to turn us into an in-house design team. No attempt to relocate it (we really like Cheltenham as a hub) or ‘borg’ it. Not interested in that. It would take very little (in corporate terms) to really give this business a rocket boost, but it will take faith. Faith in people. Faith in me. You are probably not going to be able to project forward 2 years and look at an exit strategy. Design is a fabulously exciting discipline to be in, but by its very nature (in the realms we operate) it is precariously difficult to predict. It’s not soap powder. It can’t be held. It is a little bit of cognitive gold dust. But it can work utter wonders. Utter bloody wonders. I can give you a list of testimonials that support this.

So there are my 3 wishes. My heels are clicking like you wouldn’t believe (although reassuringly I’m not wearing sparkly red high heeled shoes). I may come across as naive, slightly clueless and a tad bonkers, but I believe in this business. So much in fact that I don’t simply want to make it bigger for the sake of it. I want to make it right. I want clients to WANT to work with us because it FEELS right. Not simply because we have the right shiny kit, or the right accreditations, or the right awards, or the right associations. I like the word ‘enigma’. Something somewhat indefinable and intriguing. To coin an over-used Star Wars phrase….”The Force”. Intangible, enigmatic, empassioned, powerful and magical.

This isn’t meant to be a ‘pitch’ or a plea for help (although if you happen to be a gazillionaire with a great branded business and you fancy a punt on a fabulous design business in the centre of Cheltenham then by all means give me a call). I enjoy writing about our tribulations and uncertainties and I enjoy hearing feedback. It’s amazingly cathartic and it’s very reassuring to know that many of my posts resonate with many in similar situations. It can be a lonely game, running your own business, and I use this forum as a sounding board. It seems to be working.

I would really value comments on this one.
Maybe between us we can come up with some answers?

4 thoughts on “If I had 3 wishes…”

We face the very same problems, found the very same conclusions and equally restricted from enacting them.

Here in Cornwall, we are also face with the fact that few clients outside of Cornwall want to work with a company “all the way down there”, leaving us with few clients and all seemingly with fairly shallow pockets.

All in all, it means that when we’re busy, (as we are now) it’s difficult to focus any time on growing the business. When were a little quieter, it’s difficult to fund the growth plans you then have time to make. All this means that billable hours and working hours have huge disparity.

The problem is of course, getting funded when you report on your previous years trading show such operational inefficiencies , make you nigh on investable.

In this business too, we are face with high implementation costs. To set up a new employee, were looking at £10K minimum for IT and that’s if your new starter has well developed skill set and can hit the ground running.

And there’s no doubt about it, there is definitely a critical mass, and the 5-6 people is it. Less than that and we’re shoving shit up hill!

I too am struggling to find real answers to these problems. Unsatisfied with organic (i.e. painfully slow) growth, we are looking for such a boost and happy to sell equity to realise our ambition.

Some difficulty is that we’re only as good as the product we turn out, we can’t talk about many of them, and they can take a couple of years to come to fruition in the first place.

Yet, the industrial design sector is one of the singular largest contributors to value add. We take £500 worth of napkin sketch, get £20K do a bit of arty, engineered magic stuff and turn out a product that can generate more than 100 fold ROI, and yet were often faced with a client that then seems hell bent on wasting every opportunity to capitalize… F&*%ING FRUSTRATING!

In the end, I have no “answers” but we’re flat out working on it.

Finally though, I just have to say… I’d pay a little bit of money to see you in a pair of sparkly red shoes, clicking your heels 🙂

Another great post Russ! We need to sit down for a coffee & I can give you a brief summary of my ‘journey’ of owning a design business…from just me, then growing to a team of 6 + an office in Hong Kong with 2 engineers then shrinking back to just 2 of us. Having been on that roller-coaster I can honestly say that the business works better now with just 2 of us than it ever did when we were at our biggest, we are also more profitable now. I suspect that the reason for that is because we have been on that journey and learnt what worked and what didn’t, what we are good at and what we are not. As Richard Branson says, “you don’t learn from doing things right, you learn from making mistakes…” (or something like that anyway! I know a great little coffee shop where we can meet 🙂

It’s great to get feedback and understand that either a)our issues are not unique to us and b)others are often equally perplexed by the same things! In my eternal quest to interview as many people who have direct experiences of these conundrums, I’d be keen to have that coffee Paul. Just need to work out when 😉

Interesting read .. I have been thro similar soul searching (like for 20 yrs 🙂 …. it was when I finally followed my heart (narrow focus on doing what I love) rather than Head/normal biz advice (growth…., sell more, promote consultancy work, employ more, export more, manage more, etc. etc) … ‘that it felt right’ …..
A long chat in a pub would prob be better for this, but the nearest I could find was >>>http://issuu.com/mark77a/docs/inventor_questions_answers